Former Apple Executives Address Working Conditions in Suppliers' Factories

The New York Times today published a lengthy report discussing working conditions at the facilities of Apple's suppliers in China, part of a growing focus on how Apple's popular products are made. While the company is making strides in holding its suppliers accountable to company standards, the report cites former Apple executives who note that the company continues to struggle balancing its desire for better working conditions and workers' rights with its business priorities.

Some former Apple executives say there is an unresolved tension within the company: executives want to improve conditions within factories, but that dedication falters when it conflicts with crucial supplier relationships or the fast delivery of new products. [...]

“We’ve known about labor abuses in some factories for four years, and they’re still going on,” said one former Apple executive who, like others, spoke on the condition of anonymity because of confidentiality agreements. “Why? Because the system works for us. Suppliers would change everything tomorrow if Apple told them they didn’t have another choice.”

Apple is far from the only company experiencing such tensions, but has been receiving the most publicity due to the popularity of its products and its booming financial results.

Apple details its efforts on monitoring supplier responsibility in an annual report, outlining hundreds of audits it conducts to check for compliance and the steps it has taken to remedy issues discovered as part of the process. But sources note that while Apple routinely threatens companies with a loss of business if issues are not addressed, the company in practice has tolerate continued issues because it frequently has few alternatives in its supply chain.

“If you see the same pattern of problems, year after year, that means the company’s ignoring the issue rather than solving it,” said one former Apple executive with firsthand knowledge of the supplier responsibility group. “Noncompliance is tolerated, as long as the suppliers promise to try harder next time. If we meant business, core violations would disappear.”

The highest-profile issues at Apple suppliers have involved a number of suicides at Foxconn's facilities and separate explosions at Foxconn and Pegatron facilities last year that together resulted in four deaths and 77 injuries.

Apple has over 150 suppliers contributing to its products, many of them located in China and other Asian countries where workers are plentiful and wages low in comparison to other regions of the world. Last week, The New York Timesdetailed how the U.S. has been unable to compete with China for production of the iPhone and other devices as factories in Asia have proven to be considerably more flexible in their ability to scale production up and down and have become the location for nearly the entire supply chain.

But while the economics and logistics of manufacturing in China bring Apple speed, scale, and costs that are unmatchable in the United States, the company finds itself struggling to deal with the human factor that has become increasingly visible alongside Apple's rise to prominence.

Top Rated Comments

Anyway one should always take declarations from *former* execs with a grain of salt

I despise when people say such ridiculous things. Sometimes you can only speak freely and openly once you have left, especially after your NDA expires.

Now, on to something that won't be popular here. There will be plenty of posts that say this is a worldwide problem, not just an Apple problem-- and they'd be right. However, news like this sheds light on corporate responsibility being more of a marketing term than a way of doing business. As a company currently sitting with $97.6 BILLION dollars in CASH ON HAND, they should dramatically improve the working conditions and lives of people who make their products, not have an attitude of "well everyone else does it." While their position is popular on this forum, it's not right. Life is not all about money, it's about the health and well being of yourself, your family, and hopefully (if even to a lesser extent), your fellow man. I would pay more money for an iPod or Mac if they had decent wages and living conditions that didn't encourage worker suicides. Spare me the "I don't have more money to shell out." If you are really that bad off, then quit wasting your money on consumer electronics that you can't afford.

This sounds like the old movie cliche', "I'm sorry I had to do this" while they continue to kick/punch/abuse someone to get what they want.

The sad truth is that we want cheaper products so they use countries with lower wages and worse working/living environments. If we'd all accept a 300% jump in the cost of electronics we could manufacturer everything locally.

I'm sure one day someone will figure out how to build tiny little manufacturing robots that can assemble an iPhone with no human input so you don't have to manufacture in China.

In the meantime if Apple made a little less profit then these poor people working in these factories could have better working conditions and better pay. Apples' $100Bn cash pile is just obscene when you read stories like this.

Where's the attention on Apple's competitors? Have they solved this problem or something?

Surely it would be nice to see for comparison sake.

Apple is singled out, because (as is detailed in this report and others), it has a much more abusive relationship with its suppliers with regards to margin, and have not been willing to compromise on this to ensure decent working conditions. Apple's effective supply chain management stands out in the business: and its also built upon this very exploitation. Apple is singled out because Apple stands out. Their practices simply are more evil than that of their competitors, and if you read this article again, comparisons are drawn.

Are you saying none of the other major customers (http://en.wikipedia.org/wiki/Foxconn#Major_customers) of Foxconn have either the power or the money to do something about it?

So its ok if everyone else does it that it is ok?

And of that list the most powerful company on that list. The other companies that have money have little power to do anything. Microsoft for example may have money but they do not manufacture as much as Apple. This limits what they could do in terms of pulling contracts and forcing changes.

Apple on the hand they manufacture a lot of stuff and they have the most power to do anything and they are choosing to nothing.

That's fine, pay as much as you want, but keep your damned hands off MY wallet and don't volunteer ME into paying higher prices just because YOU have a naive view of the world.

Apple, with it's tremendous profits could still keep prices the same and pay out more. Would they accumulate wealth as fast? No. But at the same time - they would be actually living their rhetoric about fair treatment, working conditions, etc.

If apple left, someone else would fill it. Come on, you act as if Foxconn would just shut down! You are trying to act like apple cares that a million people in china would lose jobs? According to some people in this thread, apple should only care about its bottom line.

If apple threatened to move out of China, if China cared that the jobs they provided are important enough, they would change there ways, period.

If China said, ok bye bye, then that just tell us and everyone else what CHINA thinks about its people(Even more so than we already know).

You missed the point of the article too it seems. The point being is Apple isn't threatening to pull out. They have set standards and are NOT enforcing them. They aren't cracking down on their suppliers based on their standards.

Whether the article is accurate or not can be argued. But that point can't. Bottom line is - Apple has the power (more than most) to make changes and they are (seemingly) not.

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